High Deductibles Chase the Middle Class from Health Services

In a recent conversation, a good buddy enraged by his new private insurance premiums and $5,800-per-year deductible said something that struck me as undoubtedly prophetic.

"I'd literally need to be dying before I would start paying this ridiculous deductible for routine care."

Under ObamaCare, those who work for a living incur massive premium and deductible increases to subsidize those that cannot or will not provide their own insurance. In the universe of ObamaCare, unless you are among the privileged dependency class that enjoys free health care, gone are the days when cautionary calls can be made to the doctor because a child has a stomachache or bad cough, because such calls will cost you five hundred bucks or so.

As with so many utopian policies of the progressive Left, ObamaCare is rife with unintended consequences that inflict pernicious pain and damage on society.

When Ideology Trumps All

In December of 2009, Mark Steyn adroitly warned, "Democrat operators ... know that what matters is to get something, anything across the river, and then burn the bridge behind you" and that single-payer, government-run health care is "the fast track to a permanent left-of-center political culture."

As recently as August 12 of this year, Senate Majority Leader Harry Reid openly confirmed Steyn's prediction that ObamaCare is but a stepping stone toward achieving the ultimate goal of the progressive left: a single-payer system.

Now that the Obama administration has rolled out its self-proclaimed "single greatest achievement," some hard facts are finally becoming known about costs and sign-up counts, even as the government fights tooth and nail to prevent such disclosures. And for good reason: Medicaid enrollment is soaring, and new paid policies are almost nonexistent.

Financially, Obama looks to be much worse than a train wreck, but progressives don't really care about money. It's all about the ideology and getting everyone over that bridge.

Insurance Industry Suckered

In a world where government has a true monopoly over health care, there is no role for private insurance. If the bridge does get burned and socialized medicine realized, it destroys the private insurance market and drives insurers out of business. Yet faced with the very real threat of legislative extinction, the insurance industry seems oddly insouciant and compliant with the law.

So what gives?

When asked why insurers would willingly participate in a law that ultimately threatens their business, Dr. David Hogberg of the National Center for Public Policy Research explained, "At this time, the insurers are attracted to the individual mandate." He added that the industry also believes that "[i]f ObamaCare fails, the left will say we need single-payer. However, making that argument is going to be tough. Single-payer is talked about, but it is still just talk."

Regarding last Wednesday's meeting of the CEOs of the largest private health insurers at the White House, Dr. Hogberg clarified that "the meeting was called by the CEOs to discuss the pathetic enrollment of less than a million [newly insured in the exchanges]." (Little did anyone know but the number is actually in the hundreds to date, not millions.)

Given the revelation that only six people nationwide successfully signed up on day one using the exchanges, there is good cause for the industry to be alarmed. Millions of existing customers are being canceled, and if the exchanges cannot function to quickly re-sign enough customers, the industry faces a tremendous collapse in revenue. No doubt progressives gleefully see such a collapse as an opportunity to nationalize the health care industry, but unlike in 2009, there is no chance that such a seizure would pass Congress today.

ObamaCare Driving Premium Hikes

Obamacare compels insurance providers to offer policies that meet robust minimum coverage protections, cover patients with pre-existing conditions, and provide free or subsidized coverage for the uninsured. Contrary to the innumerable promises of the president to the contrary, opponents of the law predicted that premium costs would soar, and indeed they have.

As this CBS News report documents, even the least expensive new plans (the so-called "bronze level" plans) are extraordinarily more expensive than comparable existing plans.

In this report, a young lady rails against the costs of her new ObamaCare-compliant insurance coverage. Her previous policy cost her $199 per month with a $1,500 annual deductible ($3,888 total before 100% insurance coverage kicks in). The closest matching ObamaCare plan will cost her $278 per month with a $6,500 annual deductible ($9,888 total before only 70% coverage kicks in). That's a 252% increase between the plans, and she is still on the hook for 30% of all costs thereafter.

When asked whether the government had any influence over the pricing of health care premiums and deductibles, Dr. Gosberg was unequivocal. "Absolutely. As with states, [ObamaCare] has insurance commissioners that approve the ratings, and there is a time when the government and industry negotiate a price schedule back and forth."

When asked to explain the drivers that resulted in such huge increases in premiums and deductibles, Dr. Gosberg broke down the fundamentals. "Under ObamaCare, you cannot underwrite based on health status. You cannot discriminate between men and women. ObamaCare exchange community ratings are one of the biggest drivers to cost. In free-market insurance, community age ratings range from 1 to 5, youngest to oldest, with the oldest expected to cost five times more than the youngest. In ObamaCare, the ratings only range from 1 to 3. Any insurer with a brain sets premiums for the oldest and works backwards, so the young pay more than they would in the free market."

There is little doubt that the Obama administration and its supporters will begin to blame the private insurance industry for any and all ills brought on by ObamaCare. It's what they do, and since neither George Bush nor the GOP can be effectively blamed, the evil insurance corporations are the likely scapegoats.

It's important in the face of the coming PR attacks on insurers to make clear that the soaring costs are to be blamed solely on ObamaCare, as are the millions of policies being canceled.

Recognize that the next time you twist an ankle or want an aching back checked out, ObamaCare's tentacles will be in your pocket, dissuading you from seeing your doctor.

Simply put, ObamaCare, via massive deductibles, discourages people from seeing doctors when they otherwise would have in the past. That is, unless the people are among the privileged dependent on the government, of course.

In a recent conversation, a good buddy enraged by his new private insurance premiums and $5,800-per-year deductible said something that struck me as undoubtedly prophetic.

"I'd literally need to be dying before I would start paying this ridiculous deductible for routine care."

Under ObamaCare, those who work for a living incur massive premium and deductible increases to subsidize those that cannot or will not provide their own insurance. In the universe of ObamaCare, unless you are among the privileged dependency class that enjoys free health care, gone are the days when cautionary calls can be made to the doctor because a child has a stomachache or bad cough, because such calls will cost you five hundred bucks or so.

As with so many utopian policies of the progressive Left, ObamaCare is rife with unintended consequences that inflict pernicious pain and damage on society.

When Ideology Trumps All

In December of 2009, Mark Steyn adroitly warned, "Democrat operators ... know that what matters is to get something, anything across the river, and then burn the bridge behind you" and that single-payer, government-run health care is "the fast track to a permanent left-of-center political culture."

As recently as August 12 of this year, Senate Majority Leader Harry Reid openly confirmed Steyn's prediction that ObamaCare is but a stepping stone toward achieving the ultimate goal of the progressive left: a single-payer system.

Now that the Obama administration has rolled out its self-proclaimed "single greatest achievement," some hard facts are finally becoming known about costs and sign-up counts, even as the government fights tooth and nail to prevent such disclosures. And for good reason: Medicaid enrollment is soaring, and new paid policies are almost nonexistent.

Financially, Obama looks to be much worse than a train wreck, but progressives don't really care about money. It's all about the ideology and getting everyone over that bridge.

Insurance Industry Suckered

In a world where government has a true monopoly over health care, there is no role for private insurance. If the bridge does get burned and socialized medicine realized, it destroys the private insurance market and drives insurers out of business. Yet faced with the very real threat of legislative extinction, the insurance industry seems oddly insouciant and compliant with the law.

So what gives?

When asked why insurers would willingly participate in a law that ultimately threatens their business, Dr. David Hogberg of the National Center for Public Policy Research explained, "At this time, the insurers are attracted to the individual mandate." He added that the industry also believes that "[i]f ObamaCare fails, the left will say we need single-payer. However, making that argument is going to be tough. Single-payer is talked about, but it is still just talk."

Regarding last Wednesday's meeting of the CEOs of the largest private health insurers at the White House, Dr. Hogberg clarified that "the meeting was called by the CEOs to discuss the pathetic enrollment of less than a million [newly insured in the exchanges]." (Little did anyone know but the number is actually in the hundreds to date, not millions.)

Given the revelation that only six people nationwide successfully signed up on day one using the exchanges, there is good cause for the industry to be alarmed. Millions of existing customers are being canceled, and if the exchanges cannot function to quickly re-sign enough customers, the industry faces a tremendous collapse in revenue. No doubt progressives gleefully see such a collapse as an opportunity to nationalize the health care industry, but unlike in 2009, there is no chance that such a seizure would pass Congress today.

ObamaCare Driving Premium Hikes

Obamacare compels insurance providers to offer policies that meet robust minimum coverage protections, cover patients with pre-existing conditions, and provide free or subsidized coverage for the uninsured. Contrary to the innumerable promises of the president to the contrary, opponents of the law predicted that premium costs would soar, and indeed they have.

As this CBS News report documents, even the least expensive new plans (the so-called "bronze level" plans) are extraordinarily more expensive than comparable existing plans.

In this report, a young lady rails against the costs of her new ObamaCare-compliant insurance coverage. Her previous policy cost her $199 per month with a $1,500 annual deductible ($3,888 total before 100% insurance coverage kicks in). The closest matching ObamaCare plan will cost her $278 per month with a $6,500 annual deductible ($9,888 total before only 70% coverage kicks in). That's a 252% increase between the plans, and she is still on the hook for 30% of all costs thereafter.

When asked whether the government had any influence over the pricing of health care premiums and deductibles, Dr. Gosberg was unequivocal. "Absolutely. As with states, [ObamaCare] has insurance commissioners that approve the ratings, and there is a time when the government and industry negotiate a price schedule back and forth."

When asked to explain the drivers that resulted in such huge increases in premiums and deductibles, Dr. Gosberg broke down the fundamentals. "Under ObamaCare, you cannot underwrite based on health status. You cannot discriminate between men and women. ObamaCare exchange community ratings are one of the biggest drivers to cost. In free-market insurance, community age ratings range from 1 to 5, youngest to oldest, with the oldest expected to cost five times more than the youngest. In ObamaCare, the ratings only range from 1 to 3. Any insurer with a brain sets premiums for the oldest and works backwards, so the young pay more than they would in the free market."

There is little doubt that the Obama administration and its supporters will begin to blame the private insurance industry for any and all ills brought on by ObamaCare. It's what they do, and since neither George Bush nor the GOP can be effectively blamed, the evil insurance corporations are the likely scapegoats.

It's important in the face of the coming PR attacks on insurers to make clear that the soaring costs are to be blamed solely on ObamaCare, as are the millions of policies being canceled.

Recognize that the next time you twist an ankle or want an aching back checked out, ObamaCare's tentacles will be in your pocket, dissuading you from seeing your doctor.

Simply put, ObamaCare, via massive deductibles, discourages people from seeing doctors when they otherwise would have in the past. That is, unless the people are among the privileged dependent on the government, of course.